AGRICULTURAL UNIVERSITY OF TIRANA
FACULTY OF ECONOMY AND AGRIBUSSINES
Department of Agricultural Economy and Policies
And
Department of Agribusiness Management
PROJECT-ROPOSAL
In the framework of AHEED Mini-Grant Program:
Comparison of alternative solutions for efficient use of refused land in a pilot area of Albania
Working group :
Prof.Dr. Galantina Canco - Department of Agribusiness Management
Tel: +355 682 533 071; e-mail:
Dr. Xhevaire Dulja - Department of Agricultural Economy and Policies (Principal investigator)
Tel: +355 692 177 532; e-mail:
Prof. Dr. Henrieta Stojku – Department of Agricultural Economy and Policies
Tel: +355 682 015 014
Dr. Ledia Boshnjaku- Department of Agribusiness Management
Tel: +355 682 097 859; e-mail:
Dean of Economy and Agribusiness Faculty
Prof. Dr. Bahri MUSABELLIU
Head of Agricultural Economy and Policies Department
Prof. Dr. Kristaq PATA
Head of Agribusiness Management Department
Prof. Dr. Donika KËRCINI
Tirana, 31-st August 2010
TABLE OF CONTENTS
1. Problem statement 1
2. Objectives and Research Hypotheses 3
3. Literature review 4
4. Methodological aspects 5
4.1. Method of analyses 5
4.2. Data Collection and Administration 6
5. Expected results 8
6. Summarizing table on objectives, activities, outputs and outcomes 8
7. Timeline of activities 10
8. Budget of the project 11
9. Pitfalls 11
10. References 13
11. Annexes 14
Annex 1- Albanian MAP Export-Imports 14
ANNEX 2- Short bio of the research group members 15
1
1
1. Problem statement
The project-proposal titled “Comparison of alternative solutions for efficient use of refused land in a pilot area of Albania” is written by lecturers and researchers of two Economic Departments of Economy and Agribusiness Faculty.
The present project fits with AHEED Mini-Grant priority area “Production and Management Efficiency of Strategic Commodities”
During the work for designing the project consultation was accomplished with different key Albanian stakeholders that deal with the problems analyzed and discussed in the proposal. These institutions were:
· Department of Agricultural Extension and Information of Albanian Ministry of Agriculture, Food and Consumer Protection;
· Department of Nature Protection of Albanian Ministry of Environment;
· Albanian Essence Producers and Cultivators Association (EPCA);
· Help and Employment Women Association (Rural Women).
Land, in Albania, is a scarce resource mainly because of it’s relieve. Albania is mainly a mountainous and hilly country with the average altitude of 704 m above the sea level. The 2 million 875 thousand ha of the Albanian territory is divided in 696 thousand ha of agricultural land (24 % of the total), 2 million and 179 thousand ha forest and pastures (76 % of the total). Most of the agricultural land is private property passed mostly to the habitants of rural areas during the land reform in 1991(Ministria e Bujqësisë, Ushqimit dhe Mbrojtjes së Konsumatorit, 2009).
The actual official data shows that most of agricultural land belongs to 353 486 farms which are very small farms with an average surface of 1.14 ha and fragmented in 4.1 parcels per farm. According to the same data, actually are 402 287 families living in these farms with an average of 1.1 families per farm (Ministria e Bujqësisë, Ushqimit dhe Mbrojtjes së Konsumatorit, 2009).
About 72% (1 004 254 out of 1 626 019 inhabitants) of rural population in Albania is between 15 – 65 years old and belongs to the total labor force (Ministria e Bujqësisë, Ushqimit dhe Mbrojtjes së Konsumatorit, 2009).
Labor force is a juridical and economical notion based on recommendation of International Labor Organization (ILO) and includes the population in the age of work that is limited down by the low of compulsory study and up by law of social insurance. From this are excluded students, incapables and persons under law (prisoners) (Canco 2010).
According to the official data, the agricultural land is about 0.6 ha for each labor force and about 0.4 ha for each individual farm inhabitant. Considering this fact, rural population has very little land at his disposal to perform their economic activity and regenerate incomes. People in rural areas, are facing economical and unemployment problems. This problem is more evident for women especially in the hilly and mountain areas because of the mentality and less possibilities which are born by the distance from urban areas and certain isolation.
Generally speaking, there are not official statistics about unemployment in the rural areas with the justification that the rural population has agricultural land to provide economical revenues and such inoccupation does not exist. However, experts think that a hidden undeclared inoccupation exists in the rural areas. This inoccupation has in its base mainly the small farm size regarding the total population and labor force in rural areas.
Above all mentioned, actually in Albania there exist about 110.000 ha of refused land located mainly in hilly and mountainous areas of the country. Refused land is considered a part of the agricultural land not taken under ownership by farmers, ex-member of the agricultural cooperatives during the land reform of 1991 for different reasons such as poor fertility, big distance from farm holdings, etc. and the agricultural land belonging to the state enterprises not divided during the same reform. .
Refused land is divided into three main categories:
· About 30 thousand ha out of 110 thousand are more fertile and are relatively big parcels of about 10 ha planned by the Albanian government to be used in the framework of the program “Albania One Euro” and put at the disposal of foreign investors;
· About 27 thousand and five hundred hectares belong to ex-state agricultural enterprises and are planned for before socialistic system old-land owners ;
· The difference of about 53 thousand ha of the refused land is not used or planed yet (Ministry of Agriculture, Food and consumer Protection, 2010).
The present project-proposal will be focused at the third category of the refused agricultural land which is the less fertile and most eroded one. Finding a viable economic solution for the refused agricultural land will contribute to the improvement of farm families’ profits and the quality of life in the rural areas.
The main purpose of this proposal is to indicate how refused land can be used more efficiently in order farmers to increase their profits and to better orient government intervention in this direction.
Goal is to produce one recommendation to a rural pilot area on how to put in efficiency refused land of their area in order to increase rural employment and to have higher income than their optional activities.
According to our knowledge and the information provided from specialists of Ministry of Agriculture, Food and Consumer Protection and the Albanian Essence Producers and Cultivators’ Association (EPCA), the refused land can be used efficiently if planted with native Medicinal and Aromatic Plants (MAPs) that are grown naturally in the hilly and mountain areas object of the study and are highly demanded by the domestic and the international market (ANNEX 1.). Taking into consideration the good experience of Albania MAP industry and the good access of MAP exporting companies in the international market, cultivation of MAPs could be a good opportunity for the farmers to increase their profits and improve their life.
2. Objectives and Research Hypotheses
Objective 1 / To create a list of the refused land in the selected area in Tirana district and select the pilot area.Objective 2 / To identify a list of MAP species opportune to be planted with economical efficiency in the refused land of the selected area.
Objective 3 / To identify problems, possibilities, capacities and preferences from farmers point of view regarding cultivation of the refused land in the selected area.
Objective 4 / To provide a cost-profit analyses for the selected MAP species and to compare different alternatives.
The methodology of this project-proposal is based on three hypotheses which are listed in a logical consequence:
Hypothesis 1 / There is a huge quantity of refused land from the Albanian farmers which are not suitable for intensive and industrial cultivation which can be suitable and profitable if cultivated with less exigent species such as Medicinal and Aromatic Plants (MAP).Hypothesis 2 / Cultivation of some wild species which are rescued or are in the red book will help the biodiversity conservation in a long-term period.
Hypothesis 3 / There are available in the area human resources not employed especially women that have necessity to be employed in this business.
Hypothesis 4 / The international market demands this category of MAP species.
3. Literature review
MAPs are very important natural resources for human health and food. They are very important income generation resource for poor countries and rural economies that have population living in marginal hilly and mountainous areas. It is well known that many of MAP species, demanded in a considerable quantity, are grown in the mountainous and hilly zones, far from inhabited localities and very difficult to be harvested. According to extensionists of Ministry of Agriculture, Food and Consumer Protection, to private extensionists of international programs in Albania and to our opinion, the growing demand for MAPs, their adaptability to be grown under rustic conditions along with unemployment and lack of many income generating alternatives in hilly and mountain areas suggest to see the possibility of cultivation. This is important especially in rural areas where land is a scarce resource and the cultivation of the high exigent plants is difficult or not possible. Putting in efficiency refused land represents one of the ways to contrast the poverty, depopulation of the mountain and hilly areas that are favoring the emigration of young people toward the cities and especially unemployment of the women.
According to World Health Organisation there are 50,000 - 70,000 MAPs that are used in the traditional and modern medicine (Schippmann, et al. 2006). About 80% of the population in developing countries relies on traditional medicine, mostly in the form of plant drugs for their health care needs. Additionally, modern medicines contain plant derivatives to the extent of about 25%. (Food and Agriculture Organization 2002). The number of MAP species sold at the international level is about 3000 (Lange e Schippmann, 1997), while only 100 of them are regularly cultivated in an agricultural system (EUROPAM 2006).
Albania has a very with rich flora with more than 3,200 species that make up about 29% of European and 47% of Balkan flora. About 350 Albanian wild species are collected and sold as MAPs in the international market and only very few of them are cultivated in extremely limited surfaces (Ministry of Environment 2010). Albania is considered a privileged country because of the good quantity and quality (content) of raw material available mostly of wild and natural origin and because of many years of the experience, efforts, tradition and the infrastructure established with EU and US buyers in the international market (Albanian Essence Producers’ and Cultivators’ Association, 2010).
According to the data 2008, the most important trend at international level and inside the EU market is a growing demand for herbs and medicinal plants to be used in pharmaceuticals, cosmetics and food industry (especially for the substances of the natural origin). (CBI market survey: The EU market for herbal infusions, 2008; CBI market survey: The spices and herbs market in the EU, 2008; CBI market survey: Natural ingredients for pharmaceuticals, 2008: Natural ingredients for pharmaceuticals, 2008).
There was a decrease of demand for MAPs during the crises of these two last years, but however, nowadays in 2010 it is noticed an invigoration of the world market (Essence Producers’ and Cultivators’ Association 2010).
The opportunities of MAPs in general in Albania, based on:
· the special geographic position and climatic conditions which brings to high and distinguished quality;
· high biodiversity;
· the modest supporting policies of Albanian government toward exports;
· the trend of Albanian processing and exporting companies to improve quality and meet the international standards (MAP Albanian industry more advanced than the industry of other countries in the region) and
· a relatively long experience
create a privileged position and good access of Albania in the international market.
Considering the access of Albanian MAPs in the international market about twenty years ago, this access has been higher than 30 million dollars or around 20-22 million Euro (Essence Producers’ and Cultivators’ Association 2010).
The most important Albanian MAP species which occupy an important space in the international market are: Salvia officinalis ( 60 % of the American market), Satureja montana, Origanum vulgaris (wild and cultivated), Thymus vulgaris, Thymus capitata (cultivated), Pyri malus, Juniperus communis, Juniperus oxycedrus, Myrtus communis, Laurus nobilis, Helichrysium arenarium, Matricaria chamomilla (wild and cultivated), Sambucus nigra, Malva sylvestris, Achillea millefolium, Rosa canina, Lavandula officinalis (cultivated), Vaccinum myrtillus, Scilla maritima, Urtica dioica, Rasmarinum officinalis (wild and cultivated), Trifolium pratense, Sideritis roaseri , Hyperificum perforatum , Mentha piperita (cultivated), Gentiana lutea , Coreandrum sativa (cultivated) etc (Essence Producers’ and Cultivators’ Association 2010).
4. Methodological aspects
Object of this study will be Tirana district that has six communes. Detailed data on the total surface of the refused land in each of the communes will be obtained directly by the respective offices. The reason for selecting this district is the proximity of farmers with the most important processing and exporting MAP companies.
4.1. Method of analyses
In order to reach the research objectives different sources of information will be used. Collected data will be qualitative and quantitative coming from primary and secondary sources.
They will be elaborated, compared and generalized according to their nature as follows:
· Statistical elaboration with statistical programs (SPSS) of information collected from the questionnaires;
· Cost-profit analyses of the MAP species opportune to be cultivated in the area;
· Comparison of cost-profit profile of different MAP species object of the research;
· Deduction of the conclusion from the data collected and elaborated through cause-consequence analyses.
The cost-profit analyses consider two groups of data: average annual costs and incomes generated by present economical activities in the farms of selected area. Data ensured from interviews on the activities performed in a year, their costs and incomes will be put on tables and the difference between costs (will include all material and operational expenses together with labor force costs) and revenues will be calculated for each labor force in a year as well as per period of operations.